April’s Consumer Price Index report painted a stark picture of what the Iran conflict is costing American consumers at the pump and beyond. Energy prices surged 17.9% year-over-year, with fuel oil spiking 54.3% and gasoline climbing 28.4%. That energy shock accounted for more than 40% of the overall inflation increase, pushing the annual pace to 3.8%—the highest in nearly three years.
Appearing on Fox Business’s The Bottom Line, Liz Peek acknowledged that oil prices are unlikely to snap back to pre-conflict levels even after a resolution with Iran. “There’s been a lot of damage done to the energy infrastructure in that part of the world,” Peek explained, noting that roughly a billion barrels of supply have been lost. However, she argued that continued growth in U.S. oil production—already at all-time highs under President Trump’s drill-friendly policies—combined with the global economy’s natural adjustment to higher prices, will bring meaningful relief. “There’s going to be a pretty big return in terms of increased production,” she said.
Heritage Foundation chief economist E.J. Antoni reinforced the point, noting that before the Iran conflict, core inflation was actually steady during Trump’s first year. The problem now is that elevated energy costs are bleeding through to core inflation “remarkably quickly”—showing up in everything from airfares to transportation services. If energy prices reverse, Antoni agreed, headline numbers would come down fast.
The segment underscored a central tension: while President Trump expressed confidence that inflation could fall to 1.5% once the conflict ends, oil futures markets suggest prices will remain elevated into 2027, with contracts above $80 per barrel.
